Seasonal Jobs, and How They Change the Bottom Line

This is the time of year when many businesses are hiring seasonal employees, or simply increasing the hours for staff already on the payroll. Because of these changes, some may not realize how this influx of income can affect their overall tax responsibility. When getting a new job, no matter how long you are working there, a Form W-4 must always be completed. This form details the amount an employer should keep from an employee’s paycheck. Thanks to recent IRS guidance, we know that it will not be changed by the Tax Cuts and Jobs Act until 2020 at the earliest.

         When it comes to a job that involves tips, it is a good practice to keep a log of the amount, and date of the tip. All tip income must be reported and keeping good records makes the tax return process that much easier. Sometimes, the amount made from a seasonal job will not be high enough to end up owing income tax. Often it is students and other young people who are getting their first jobs at this time, so this experience helps to build good habits that will prove useful in the future.

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